Request For Plus-Up Funding

This “Request for Plus-Up Funding” is an example of a White Paper format which can be submitted to a Company’s congressional office (Senator or Representative) to request for additional funds as a follow-on effort to a previously funded SBIR Phase I or Phase II contract. This Request may only be used if the company has performed work in relation to the award of a SBIR or STTR award. Because this “Request” is only a form example, it must be adapted by the SBIR/STTR Company to meet their specific requirements and expectations. This “Request” does not in any way constitute legal advice from AMT. Each SBIR/STTR Company should seek the advice of professionals to assist in understanding the terms, conditions, and methodologies used in seeking congressionally directed Phase III funding.

DRAFT#1

Request for Plus-Up Funding into

Office of the Secretary of Defense (OSD)

Small and Disadvantaged Business Utilization (SADBU)

[Almost any Program Element account will work for this type of action.]

SBIR Phase III Funding

Introduction

The Department of Defense (DoD) has previously sponsored Small Business Innovation Research (SBIR) efforts, with our company: ABC. Inc.,Sometown, Texas. ABC has developed a processing technology to produce a breakthrough advance in [the company’s technology] which is of critical use to the DoD as well as offering outstanding potential to the commercial private-sector. ABC respectfully seeks a congressional appropriation from your office within the 2006 Defense Appropriation Bill as Plus-Up funding in the amount of $[less than 5] millionto be placed into OSD/SADBU Program Element #0605790D8Z (SBIR Admin) [any Program Element will work here as long as you can have the government POC act as a “champion” for you.] and implemented as an SBIR Phase III to perform additional research for DoD applications incorporating our “key phrase that only occurs in the company’s title or abstract”technology. The government technical POC at OSD/SADBU is Mr. Mike Caccuitto (703-588-8610).[It is important to have a “champion” that will implement the funds in precisely the manner for which they are appropriated.] Also, there is a POC at [a secondary POC is good but not critical] who is very knowledgeable about our technology. Specifically, these funds will be used to mature the further development of our patented process to improve the [company’s technology] -- with subsequent production and sale into military programs and commercial uses.

Our company’s continued development is focused on the scale-up of this process to achieve production level developments – with direct application in fields of [specific military usage] , [generic military usage],and commercial [usage and application that anyone could understand]. The funds will be used to acquire key capital equipment and to hire [How many? #] key scientific and skilled personnel. ABC anticipates that as production increases our company will create any additional [XX]jobs for the local economy.

Implementation of our plans are based on outstanding progress to date, solid acclaim from current government sponsors and enthusiastic feedback from potential commercial customers. ABC has a clear view of the way ahead in terms of product development and market application. Current projections show a major increase to the company’s employment roll and revenue tax base as a result of these programs—well over a [xx] fold increase in each case over the next 4 years—resulting in the firm establishment of another world class [Texas] based high technology company.

Identified Need and Background

Ever increasing technology demands in support of DoD has created an intensifying problem toward making national defense a reliable reality. Our process has already demonstrated and proven its viability and can be made at a highly competitive cost but further refinement is still needed as scale-up to commercially feasible levels of production is mandatory.

Our recent efforts established that the innovative [a“distillation” from the Phase I or Phase II abstract]. This is this aspect for which [the DoD component – Army, Navy, Air Force, MDA, DARPA, SOCOM, DTRA, CBD, OSD, or NGA] funded our efforts initially under their SBIR Program.

Furthermore, our developments shall evolve to the logical maturity stage in which complete and realistic testing and scale-up is realized. The ultimate objective will be the utilization of [the company’s technology] as integral components of future DoD systems.

ABC’s Technology

[Place a paragraph about the physics of the company’s process. Should be a “distillation” from the presentation that the company will give to the Staffers.]

Applications

Notwithstanding the well-publicized downturn in the high-tech industry, ABC’s patented process is attracting considerable commercial and military attention. Specifically, several commercial companies have expressed keen interest and discussions are still evolving toward a mutually-beneficial arrangement. [Which companies, if you can say, and what are their interests?] Our business is ongoing, but still maturing, and is expected to lead to other programs as our process begins to be accepted into mainline developments. There are several military applications [What applications, if you can say?] under investigation and this plus-up funding will allow ABC to pursue those efforts more aggressively.

Our product is now actively being considered by several military programs for possible inclusion in their next-generation systems and upgrades. Specifically, there is tremendous advantage in using our [technology] in [which military/government] applications, incorporated into a system, sub-system, or component, to increase the operational effectiveness of the overall system.

Additionally, our process will make ABC and its [the company’s technology] product line an ideal candidate to address next-generation DoD applications—or any other application where [the company’s technology] is required. Development of better technology is the focus of projects currently under way within NASA, the DoD, the [DoD component which funded the Phase I], and other independent sponsors. [The previous sentence can usually be worded as required.] Specifically, this area is predicted to have major commercial impact within the next 3-5 years but only if we are successful in a scale-up to volume production to meet the anticipated commercial demands.

Company Development Focus

[This is ABC Company’s mission statement and

business plan rolled into one paragraph.]

Proposed Funding Request/Report Language

ABC, Inc. seeks $[less than 5] million in Plus-Up funding to be placed into the OSD/SADBU Program Element #0605790D8Z (SBIR Admin) [same comment as in the first paragraph] and implemented as an SBIR Phase III effort, to perform additional research in our “[key phrase]” technology. Proposed Defense Appropriations Bill language:

An additional $[less than 5] million, to be implemented as an SBIR Phase III, is provided into PE 0605790D8Z (SBIR Admin, Line #126, Defense-Wide) for further development in “[key phrase]”.

The government point of contact at OSD/SADBU is Mr Mike Caccuitto (703-588-8610) and at [a secondary POC is good but not critical].

Notes:

Please feel free to edit as necessary, this is only the skeleton. There are several areas that need to be embellished in more detail than I have here. Obviously, each company will have their own spin on how to develop this White Paper.

Keep in mind that timing is very important as one works with the congressional “Staffers”. The House begins their build of the Defense Appropriations Bill in the Jan/Feb timeframe. The Senate begins their build of their version of the Defense Appropriations Bill in the Mar/Apr timeframe. If you can get exactly the same language for a Plus-Up request placed in both bills then it will never go to the Conference Committee – you get what you ask for. However, this does not happen very often.

Try to stay away from too many numbers unless the company can relate them to something that the “Staffers” can relate to. Also, stay away from the “techno-speak” in the body. Try this test: Give it to a trusted non-technical person, (one company President gave the request to his Minister,) and see if they understand it more than just a request for more funds, or “pork-funding.”

The entire White Paper should be “trimmed” so as not to exceed two pages. Further, all the pertinent material needs to be in the first paragraph, because sometimes the Staffers will not read beyond that point. Also, the second page may be lost or removed in handling.

Several “tricks” that have worked for other companies:

1)When the company talks to the Staffer they should have a sample of the “finished product” that the Staffer can walk away with and give to the Senator/Congressman. In their mind they become an “expert” on the material and remember more of the specifics of the company’s briefing. If the company can place their materials into a working model, this may prove useful, but the company will need to impress why their technology is better than what is already available.

2)The company should have a photograph of the outside of their company, but only if makes them look good. Otherwise a picture of the lab (but one lab looks much like any other lab) or the equipment that made the “finished product” from #1.

3)The company should schedule a time for the Senator/Congressman to come for a visit so that they can get some political mileage from the funds that the company receives. SBIR and small business audiences provide a “friendly” audience for the politicals because they will never say that they are against Small Business. The company’s facilities are a great venue. Hosting a small business conference at the company’s facility sometimes works well. Invite the local news press to be in attendance during the visit. The visibility will be good for the politicians and for the company. (“Local company advances technology to protect the Nation” and all that other fluff that sounds good on TV.)

4)Paperclip the company’s business card to the first page so that the Staffers have all the pertinent contact information necessary to reach the company principals. It may get separated from the White Paper, but it does tend to leave an impression with a Staffer. First page could be a letterhead, but that is not an absolute.

5)The company should be prepared to address during their discussions with the Staffers, as specifically as possible, how many jobs they will be creating (the more the better) and what capital equipment they will be acquiring and how they will be growing their company. Consider that this may be viewed is “pork funding” and what will make your company any different than any other company coming to the Staffers and asking for money.

Finally, I would suggest that the company always be prepared to get less than they request (consider that there will be a 15% dilution factor of the approved funds before the company will see them), but develop a good rapport with the Staffers because once the company gets the Phase III under contract it is easier to add to it in the following year, because the company will have a contract number to reference. One MDA SBIR company received their fourth year of funding in FY04 ($2.1M in FY04 alone) for a four-year total of about $10.1+ M, but that company goes in for a one-year request each year. If a company does not get the funding, they should stay in close contact with the Staffers on a regular basis because there may be other opportunities to get the funds during the year, but the Staffers will tend to work the process harder the following year.

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